Person to person

February 1st, 2016 / By: / Business, Management

A Chinese monk checks his smartphone between Buddhist services at the Yuanjin Buddhist Temple, Zhujiajiao, Shanghai. Photo: Dr. James Chan
A Chinese monk checks his smartphone between Buddhist services at the Yuanjin Buddhist Temple, Zhujiajiao, Shanghai. Photo: Dr. James Chan

Meeting face-to-face with overseas customers brings a wealth of benefits.

I’ve been traveling to Asia, including China, since 1981, promoting U.S. products for more than 100 firms. One vitally important lesson I’ve learned is the value of talking with overseas customers in person. Face-to-face conversations with prospects and customers bring tremendous and unexpected orders—and they can be a source of joy and discovery besides.

Candid communication, plus

In October 2015, we took a 10-day trip to China to visit a repeat customer that our Shanghai agent had lined up. When we began showing PowerPoint slides of a new technical design, a top engineer who has studied our type of precision-engineered products for 30 years jumped up and said: “This is clever! This is exactly how it should be done!” She asked us to bid on a project to replace the design of our competitors. Until we showed up and showed that particular slide, we had no idea that our new technical design would get her so excited and actively interested. You may not know you have a winning product until you talk about it in person.

During the same trip, we traveled to see another customer to settle technical issues that had been brewing for three months. At first, the director of the technical department chided us for being difficult. She said: “We know that you are the global leader in this field, but I think you don’t care for our business because our orders are not big enough!” It was not true; we wanted her business.

Half an hour later during the meeting, the project manager told us that his company had misled an end-user customer and needed us to play the “white knight.” Until we showed up, he did not want to tell us that. For that same reason, he never told us the correct technical specifications, which prevented us from coming up with the right engineering design. After the director left the room, the project engineer relented and gave us the exact specifications we needed to do our work. We recalculated our performance data. The business could have gone to our competitor had we not shown up that day.

The limitations of paper

I once needed to recruit an agent for a client in the corporate database business. I advertised in the Chinese media and received more than 30 resumes electronically. I screened the candidates, selected five and called them on the phone. I narrowed the list to three candidates and subsequently traveled to China to see them in person. I was disappointed in all three. What looked good on paper did not match my expectations. In many overseas markets and especially in countries such as China, Japan, Taiwan and South Korea—places that value the Confucian ethos of interpersonal ties—it is crucial to tap into one’s professional and friendship networks to find the right agent. I finally found our agent the old-fashioned way.

Buyers Lead marketing

I once spent 45 days in China representing a publishing company to promote scientific books and journals in China. I met more than 150 professionals and import officials during my road shows. An acquisitions manager in one of those presentations showed a willingness to speak with me privately. The buyer said: “Mr. Chan, I know you’re sincere [about] selling your scientific monographs to China. We know they’re good and we want to buy [them]. But you must realize that if we won’t be allowed to buy more than 75 units of a single monograph, someone [else] will copy your titles without your permission and knowledge.”

At first I was disappointed and discouraged, but this seemingly bad news made me come up with a new marketing strategy. Before I had gone to China, I was promoting only our top 10 monographs because they were selling thousands of copies in Europe and Japan. With the buyer’s tip, I promoted our company’s entire list of 600 existing titles. I got a $370,000 order from China shortly after my trip. The buyer taught me to set realistic expectations in selling to Asia outside of Japan, not just China.

Building trust

In 2015, we met an engineer who works at China’s top research and development institute in our field. The man graduated from Tsinghua University—China’s MIT—and we admire his engineering acumen and forthright personality. Since the mid-1990s, this man has been specifying our product every time he designs a machine of a certain size. During dinner, we asked why he wanted to buy from us instead of buying from local suppliers. Chinese-made parts are cheaper; and he would not have to pay import duties, air freight and other fees that may add 35 percent to our selling price. Furthermore, he does not need to worry that Chinese customs officials will cause shipment delays with last-minute demands. He said: “We buy your product for machines that are of a certain size because the cost of your part accounts for only a small percentage of the total cost of the whole machine. Also, your part is reliable and of high quality and I feel comfortable using it in my various designs. After all, what’s wrong with buying from people we get along with and are happy doing business with?” Our dinner further cemented a profitable and long-term relationship.

In many overseas markets and especially in countries such as China, Japan, Taiwan and South Korea—places that value the Confucian ethos of interpersonal ties—it is crucial to tap into one’s professional and friendship networks to find the right agent.
James Chan, Ph.D., president, Asia Marketing and Management

Building understanding

My time was running out to find an agent in China to handle our growing business. I called an old friend in Beijing who was the marketing director of a multinational pharmaceutical company. He gave me a contact in Shanghai and we flew there to interview the candidate after vetting his resume.

After he learned what we design and manufacture, he said: “Mr. Chan, I think your engineered products have only three more years of sales. There are companies that can reverse engineer your products and sell them at one-third of your price.” He was frank and forthcoming with his opinion. We told him that we had been selling our products in China for 17 years and we needed a new agent because the previous one had disappeared, without reason, overnight. We also told him that, working for us, the previous agent became a millionaire (U.S. dollars). I told him we couldn’t guarantee that we could turn him into a millionaire as our representative in China, but asked if he would still like to work with us. He thought through the matter in three days and quit his Fortune 500 company job to become our exclusive agent in China. This man has now been our agent for 11 years—and he, too, has since become a millionaire.

Supporting your agents

Our agents need our physical presence with them, and even a good agent is not enough to make our business successful. Each year, we take a trip to China and other parts of Asia to help our agents see prospects and customers. After years of working with us, one agent told me during our October 2015 trip: “It’s not enough that I visit customers and prospect on my own. Executives and technical professionals from the United States head office must show up with me. Many customers ask in-depth technical questions that only your most seasoned technical people can answer. They will make tough demands that your executives have to handle in a way so that [the customers] don’t feel insulted or disrespected. Besides, your being here makes them feel that I am truly your agent,” he said. “They won’t say it—but they’ll believe it when they see it.”

James Chan, Ph.D., is president of Asia Marketing and Management (AMM), Philadelphia, Pa.

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